Real-time insight into data can help small and midsize organizations meet strategic priorities, remain competitive against larger rivals and digital start-ups, and improve experiences for both customers and employees.
Oxford Economics and SAP surveyed 2,000 executives from small and midsize organizations about their progress toward updating their technology and processes to better understand and serve customers and employees. The results show that executives tend to understand the strategic importance of data and analytics—but must improve their capabilities in key areas in order to increase their responsiveness to market needs and overall business performance.
A data deficit
Q: To what extent do you have the data you
need to support improvements in analytics
based decision making?
- Slight Shortage 47% 47%
- We have what we need 39% 39%
- 14% Major Shortage 14% 14%
Q: What are the current top internal challenges to meeting your organization’s strategic priorities?
- Inability to gain insights from data 29% 29%
- Lack of adequate data 20% 20%
Data is a weak point for many small and midsize organizations in our survey, especially in areas such as analytics-based decision-making. 61% cite a shortage of the data they need in this area, with 47% reporting a slight shortage and 14% citing a major shortage.
Top financial performers—a subset (7%) of our respondents with the strongest reported revenue growth and profit margin change over the past three years—lead the way in several areas related to technology adoption, including data analytics: 63% report having the data they need to support decision-making, compared with just 38% of others.
Making sense of available data is an even bigger challenge than collecting it. One-fifth of all respondents report a lack of adequate data as a top barrier to meeting strategic priorities, and 29% cite an inability to gain insights from their data. Furthermore, 28% a lack of analytics for gaining insight into workforce skills needs or employee wants and needs as top challenges to improving employee experiences.
Analytics tools that allow employees across the business to quickly make meaning from data could alleviate these issues and pave the way for continued growth and market competitiveness.
Looking for real-time insights
Small and midsize organizations understand the imperative to improve customer and employee experiences, but may underestimate the role of analytics in meeting those goals. Less than one-fifth of respondents identify analytics as an important technology for managing customer (18%) and employee (17%) experiences. Perhaps unsurprisingly, real-time insight is a top benefit of using analytics to manage experiences, cited by nearly three-quarters of executives who use the technology.
Q: Which technologies are most important to managing customer and employee experiences at your organization? n=2,000
1. Customer experiences
2. Employee experiences
- Chatbots/virtual Experiences 27% 27%
- 10% 10%
- Office automation tools 9% 9%
- 26% 26%
- Analytics 18% 18%
- 17% 17%
Q: What are the top benefits of using analytics to manage customer and employee experiences?
1. Customer experiences n=357
2. Employee experiences n=332
- Provide insights in real time 70% 70%
- 73% 73%
- Increase efficiency and productivity 38% 38%
- 30% 30%
- Support development of higher quality products and services 23% 23%
- 19% 19%
Small and midsize organizations boast some key advantages over their larger rivals, namely in their ability to forge close bonds with customers. In fact, 52% agree that small and midsize organizations have a competitive advantage over larger organizations in some areas. However, more than two-thirds (67%) of respondents agree that larger organizations are increasingly able to provide personalized experiences to customers—once a key differentiator for smaller organizations.
Investing in the right tools can keep small and midsize organizations competitive, especially during operational disruptions and economic downturns. But many are not yet equipped with what they need: 31% cite a lack of technology for analytics as a barrier to improving customer experiences. As emerging technologies such as predictive analytics and artificial intelligence become more accessible, small and midsize organizations will need to integrate them into their operations to remain competitive against larger rivals.
Next steps for improving analytics capabilities
Small and midsize organizations already are taking steps to improve their analytics strategies. More than half (55%) of respondents have started improving analytics on customer data, while 26% have already done this across their organizations. And when it comes to predictive analytics, most respondents are either planning investments (31%), piloting implementation (30%), or already using it in some applications and projects (27%).
Many organizations also report benefits from their investments: nearly three-quarters agree that digital technologies have meaningfully improved their customer (74%) and employee (68%) experiences. But executives from small and midsize organizations can further improve their use of data in a number of areas:
•Develop your data capacity. Embed analytics into other technologies and processes whenever possible to ensure you have information from across the business that helps inform your business management, from back-office operations to customer-facing functions.
•Prepare for growth. Tools that help manage processes across the organization need real-time access to multiple data sources. Take advantage of your data from across functions and external sources, and provide a platform for future growth.
•Make a plan for AI. To stay competitive against large companies and digital startups, begin developing use cases for artificial intelligence, machine learning, and predictive analytics—all of which will be critical to generating, analyzing, and acting on data in the years ahead.
•Capitalize on your strengths. Small and midsize organizations have some inherent advantages over their larger rivals, including the ability to collaborate more easily across business functions. These connections can help support data collection and analysis processes that allow for clear visibility into management tactics across the organization as it grows.
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